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The Franchise Memorandum

Franchisor Not Liable On Appeal for Injury at Franchised Location

In Espinosa v. Accor North America, Inc., 2015 La. App. LEXIS 2294 (La. App. July 8, 2015), the Louisiana Court of Appeal affirmed a lower court ruling that franchisor could not be held liable for injuries sustained by a guest who was shot at a Motel 6 location owned by a franchisee. Espinosa, who became a paraplegic as a result of the shooting, alleged that a broken gate enabled the armed robber to enter the parking lot. As against the franchisor, Accor, Espinosa asserted claims of direct negligence and vicarious liability, with the vicarious liability claim based on alleged actual and apparent agency.

The appellate court concluded Accor could not be liable under an actual authority theory because it "did not have the authority to exercise control over the day-to-day operations of the Motel." The court highlighted that the applicable franchise agreement vested control over safety matters with the franchisee and that Accor did not manage the motel. The court also ruled Accor could not be liable under a theory of apparent agency, concluding that there was no evidence that Espinosa had detrimentally relied upon any representations of Accor. Finally, the court held Accor could not be held liable for direct negligence because it did not own or manage the motel.

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The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP. 

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